Palantir Pays $1.6 Million To Settle Hiring Discrimination Lawsuit With Department Of Labor

Palantir Technologies, the data analytics startup valued at $20 billion, has settled charges brought by the U.S. Department of Labor that its hiring practices discriminated against Asians applicants.

The Palo Alto, Calif.-based tech firm will pay more than $1.6 million in back pay and other relief and must hire at least eight people from the affected class for two different types of engineering roles, according to an agreement announced by the Labor Department’s Office of Federal Contract Compliance Programs (OFCCP), which brought the case last fall. A judge approved the settlement on April 21.

In September, the agency alleged Palantir prevented the hiring of Asian applicants on the basis of their race during an 18-month period beginning in January 2010. Asian applicants were "routinely eliminated" in résumé screening and telephone interview phases of the hiring process, despite being "as qualified as white applicants" for engineering positions, according to the government’s complaint.

An adverse decision in court could have saddled Palantir with penalties. More importantly, the company could have been barred from seeking business from an extensive list of government customers. Palantir, which did not admit wrongdoing in the settling the case, can now continue to grow its lucrative government business without the threat of being banned as a federal contractor.

“We disagree with the allegations made by the Department of Labor,” a Palantir spokesperson said in a statement Tuesday. “We settled this matter, without any admission of liability, in order to focus on our work. We continue to stand by our employment record and are glad to have resolved this case.”

Palantir, which has received more than $340 million in government contracts since the beginning of 2010, settled after seven months of negotiations with Labor Department officials in Washington and San Francisco. Palantir’s move comes after Seattle-based tech company Splunk settled its own hiring discrimination suit in February. The Labor Department continues to pursue similar charges against Oracle, which it accused of favoring Asian employees for technical positions and paying white males more than their counterparts and Google, which has repeatedly declined to disclose employee compensation data to the department as part of a government audit.

The settlement, which was approved by administrative law Judge Steven Berlin, also requires Palantir to “develop and implement an auditing system that periodically measures the effectiveness of its total affirmative action program.”

“We appreciate Palantir working with us to resolve these issues,” OFCCP acting director Thomas Dowd said in a statement Tuesday. “Together, we will ensure that the company complies with equal employment opportunity laws in its recruitment, hiring and other employment practices.”

Employment lawyers said that under President Donald Trump, the Labor Department would likely not prioritize cases like the ones against Palantir, Google and Oracle, citing previous statements the administration has made on workplace discrimination. Trump’s original pick to head the Labor Department, fast food magnate Andrew Puzder, withdrew his name from consideration after heavy media scrutiny of his past business practices. Current nominee Alexander Acosta, who was appointed to the National Labor Relations Board under President George W. Bush, is expected to be approved as soon as this week.

The Labor Department retains a right to pursue Palantir for any violations of the terms of the agreement. It’s unclear whether Palantir has already filled or attempted to fill the jobs in question.

While a significant portion of Palantir’s revenue comes from government contracts (CEO Alex Karp said recently that 2017 would be the first year private contracts brought in more revenue than government deals), the company’s relationship with the current administration hasn’t been without controversy. Karp told employees in 2015 that “it would be hard to make up someone I find less appealing” than Donald Trump, according to a leaked video of the conversation obtained by Buzzfeed News. A Palantir spokesperson declined to comment on the video.

I'm a San Francisco-based reporter covering the agitators in technology and e-commerce. I started at Forbes as a member of the wealth team, putting together the magazine's well-known World Billionaires and Forbes 400 lists. I've worked at a number of publications including ...